• 1979 ESTABLISHED
  • 72 MUNICIPAL CLIENTS
  • 30-40 SINGLE AUDITS ANNUALLY
  • 45+ NONPROFIT CLIENTS
  • 1 LOCAL OFFICE PLEASANT HILL
  • 0 LAWSUITS

Month: April 2020

Expanded Small Business Loans

Paycheck Protection Program (PPP) https://www.sba.gov/funding-programs/loans/paycheck-protection-program-ppp

UPDATE: SBA has reached the spending limit for the first CARES ACT. Many banks are still accepting applications in hopes for additional funding to be approved.

  • Funds are provided int the form of loans that will be fully forgiven when used for payroll costs, interest on mortgages, rent & utilities
  • At least 75% of the forgiven amount must have been used for payroll. Loan payments will also be deferred for 6 months
  • Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels.
  • Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease
  • All Small businesses eligible
    • 500 or fewer employees – including non-profits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships and independent contractors are eligible
    • Also certain businesses with more than 500 employees may also qualify
  • Small businesses are eligible to borrow up to 250% of their average monthly payroll expenses up to a total of $10,000
  • The amount is intended to cover 8 weeks of payroll expenses and any additional amounts of making payments towards debt obligations
  • The 8 week period may be applied between February 15, 2020 and June 30, 2020. Seasonal business expenses will be measured using a 12 week period beginning February 15,2019 or March, 1 2019

Economic Injury Disaster Loans and Loan Advance https://www.sba.gov/disaster-assistance/coronavirus-covid-19

  • Up to $2 million in assistance
  • These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses. The interest rate for non-profits is 2.75%
    • If you already have an EIDL loan for payroll it is possible to refinance to a PPP loan above.
  • The SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay
  • The loan advance can provide economic relief of up to $10,000 within three days of a successful application. This loan advance will not have to be repaid

SBA Debt Relief Program

  • The SBA will also pay the principal and interest of new 7(a) loans issued prior to September 27, 2020.
  • The SBA will pay the principal and interest of current 7(a) loans for a period of six months.

SBA Express Bridge Loans

  • Allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 with less paperwork. 
  • Can be used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan
  • Up to $25,000
  • Fast Turnaround
  • Will be repaid in full or in part by proceeds from the EIDL loan
  • To apply contact your local SBA office https://www.sba.gov/local-assistance/find/?type=SBA%20District%20Office&pageNumber=1

COVID-19 and Taxes

Here is a broad look at some of the key provisions recently passed & FAQs about the tax deadline extension.

Has the 2020 tax filing deadline been extended?

Per IRS Notice IR-2020-58, the IRS has extended the FILING deadline.

                                   Tax Day is now July 15:

The tax balance due payment date has also been replaced with July 15th regardless of the amount you owe.  You also have until July 15th to pay your tax bill without interest or penalty.   No additional forms or extension requests are needed.

The revised due date applies to: 

  • Individuals
  • Corporations
  • Trusts
  • Estates
  • Partnerships
  • Associations

What about my estimates?

This is what your 2020 estimate schedule could look like: 

                         FEDERAL                                         CALIFORNIA

Qtr 1                           due 7/15/2020                                   due 7/15/2020

Qtr 2                           due 6/15/2020                                   due 7/15/2020

Qtr 3                           due 9/15/2020                                   no 3rd quarter due

Qtr 4                           due 1/15/2021                                   due 1/15/2020

If I don’t have it together by July 15th, what happens?

Just like the old days, you or your CPA will need to request an additional extension. If you can’t pay by July 15th, you should consider a payment plan.  Keep in mind that interest and penalties will start accruing on outstanding balances starting July 16, 2020.

What about my IRA and H.SA Contributions, are they extended?

Yes, the IRS confirmed that July 15, 2020 will also be the deadline to make 2019 contributions to IRAs and health savings accounts (H.S.As).  Deadlines associated with contributions to workplace savings plans are not affected.

Should I wait to file my taxes in 2020? 

No, if you can file your return, there is no reason to wait for the deadline. In fact, if you are expecting a refund, you should file as early as possible. The sooner your return is accepted, the sooner you will receive your money. 

Will my refund be delayed because of coronavirus? 

So far, refunds are still being processed normally. If you are expecting a refund, you should file your 2019 return as soon as possible. There is no reason to wait.  Filing now will help ensure that you see your funds without any kind of delay.  The IRS website boasts that most refunds are issued within 21 days.

If you need to trace your refund, please use the IRS website “Where’s My Refund?” .

What about California returns? 

Everything for California has now been postponed until July 15, 2020. This includes:

  • All individual and business returns for 2019
  • All individual and business return tax balance due for 2019
  • All 2020 Quarter 1 and Quarter 2 estimate payments
  • All 2020 LLC Taxes and Fees

The California State Controller has stated taxpayers will continue to get their refunds timely.

What about other tax stuff ?

  • Property tax collectors state-wide have said they WILL NOT waive the property tax deadline. You might be able to apply for hardship waiver, but it’s a case by case basis. The Contra Costa Tax Collector posted a friendly reminder that secured property taxes are due no later than Friday, April 10, 2020.
  • Social Security offices are closed to the public. You may still conduct some business by phone or online.
  • If you have lost your job or can’t work because of a COVID-19, you can apply for disability insurance with the California Employment Development Department. Gov. Gavin Newsom waived the waiting period, so you can apply immediately.  Website:  www.edd.ca.gov
  • Federal student loan payments have been deferred for 60 days without penalty.
  • There is a temporary waiver of early penalty for certain withdrawals from a qualified retirement plan if made for coronavirus-related purposes. Furthermore, the distribution is taxed over three years.
  • The bill also waives the required minimum distribution rules for calendar year 2020 for certain defined contribution plans and IRAs.  Individuals are usually required to take mandatory distribution starting at age 72, but such distributions are NOT required during 2020.  This provision is effective for calendar years beginning AFTER Dec 31, 2019.

Talk to your local bank and credit card company. Some are allowing for auto loan deferments, credit card deferred payments, refund of overdraft charges and hardship programs for mortgage customers.